Month: August 2021

NBFCs provide liquidity help to Micro and Small Enterprises (MSEs) affected by the Covid-19 epidemic. In addition, the initiative will give the NBFCs assets to support operational continuity and promote onward lending to small and medium-sized businesses.

Goal of The Scheme

The scheme aims to give liquidity assistance to MSMEs affected by Covid-19 through non-banking investment firms, especially fintech NBFCs. The unique program will provide NBFCs with term loans to ensure operational continuity and advance onward funding to MSME (Micro, Small, and Medium Enterprises).

ELIGIBILITY CRITERIA

NBFC must be recognized by the RBI as an Investment and Credit Company (ICC) to be accepted for this program.

• An NBFC can make term loans through a particular liquidity program if it has been in the company for three years and has three years of balance sheets.
• To be qualified for the plan, non-banking financial companies must have a net-owned fund of Rs.50 crore and a minimum value of assets of Rs.200 crore.
• The financial institution must have a BBB or higher external ratings (as of March 31, 2020).
• The NBFC must adhere to all applicable regulatory regulations.
• According to the Bank’s internal guidelines, the NBFC must pass the Go/No Go Guidelines.

BENEFITS

The plan is open to any organization that meets the definition of a micro or small business as defined by the Medium Enterprises Development Act of 2006 or the term specified in a GoI Gazette Notification.

TENOR

After one year from the time of drawl or June 10, 2022, whichever comes first, the SLS loan must be returned in bullet installments.

SECURITY

The program provides need-based security as per the Bank’s current policies.

PROCESSING FEE

The MSME must pay 0.10 percent of the authorized amount, up to a maximum of Rs.5 lakh, plus GST if required.

ABOUT APPLICATION FORM

Mail attached copies of the duly signed registration form, certificates, and papers to rbisls2_nbfc@sidbi.in.

DOCUMENT

For the SLS program, the following documents are required:

• Information about the company’s promoters and directors.
• Issues of the Parent or Holding/Subsidiary/Associate
• As of March 31, 2021, the Consumer’s and Parent/holding Company’s shareholding patterns are detailed.
• Beneficiary ownership statement.
• A full specification of the most recent Memorandum and Articles of Association is necessary for addition to the organization certificate.
• A legal document of the RBI’s Certificate of Registration
• Annual Reports from the previous three years
• Declaratory statement on banking services
• The most recent Asset Liability Maturity Profile has been lodged with the RBI.
• The RBI has received the most recent certified returns.
• Copy of legal documents like passport and PAN CARD of the promoters/directors and permitted signatories of the firm.
• Each director must sign an assurance giving his or her agreement to examine the CIBIL database and the credit reports included in Annexure-V.
• If personal guarantees are given, the guarantor’s most recent CA verified net worth statements are required.
• Reasons for the most recent rating

FEW MORE DETAILS

NBFCs that finance two-wheeler loans and cannot provide proof of MSE status and NBFCs with a dominant portfolio of gold loans will not be eligible for the plan.

CONCLUSION

The program would provide time loans to banks, NBFCs, and MFIs to maintain system continuity and promote forward lending to MSMEs, according to Sidbi. The loans will be for 90 days. SIDBI is dedicated to assisting MSMEs in surviving the crisis caused by the Covid-19 epidemic. The money will be distributed to qualifying MSMEs through banks, NBFCs, and MFIs. They anticipate that MSMEs’ financial problems will be addressed quickly and adequately by doing so.

We at SDS Fin Advisory LLP are engaged in the field of Project Finance, MSME Loan, Working Capital, Unsecured loan, and Government Subsidy work for 20 years. If you are looking for financial assistance in terms of machinery loan, Term loan, Cash Credit, Export finance, Capital Subsidy, interest subsidy, we are always ready to give you the best guidance and assistance. Feel free to contact us on 848596003 or info@sdsfin.in.

Several small businesses are getting benefits from the latest industrial policy published by the Gujarat government. Several incentives and subsidies are supporting businesses to invest more in the manufacturing and other operations of the business. Several talukas have multiple benefits where the business owners get direct benefits. The industrial policy shared by the Gujarat government promotes businesses on a global level and stimulates sustainable development. The government has decided to provide direct benefits to the MSMEs and increase the shares of state GDP. 

The current industrialization policy is so beneficial for the business owners that can enhance the revenue of the business on a global scale. Recently the Gujarat government is thinking to increase the MSME business by introducing an MSME award for the business. It will strengthen the micro, small, and medium enterprises and their manufacturing will get an instant boost. The government will analyze the quality, production, innovation, and employment to award the MSMEs that will motivate them to increase production on a global level. 

For startups, the government has introduced the best MSME startup program under the industrial policy in 2020. The startups will also get several benefits in the schemes, and their modal will be appreciated on an international level.

The Gujarat government has introduced the “scheme for awards to MSMEs” with the latest industrial policy.

• The name of the scheme is given as “Scheme for Awards to MSMEs” by the government. 
• The scheme is for five years from the date of commencement, i.e., 07/08/2020. The businesses will get benefits till 2025.

Now let’s check what type of industries can take benefit of the schemes and understand them properly.

Micro, Small and Medium Enterprises- The business should follow the regulations set by the government for Micro, small, and medium enterprises according to the definition given in the MSME development act 2007. The business should register with Udhyog Aadhar Memorandum or Udyam registration.

Eligible Business- 

• The business should be operable for at least three years, and continuous production or supply should be active from these three years. 
• The businesses should have all the clearances to perform the business, and all the applicable licenses should be there. 

State awards for Best MSME

• Different awards for micro, small and medium enterprises-  
• There are three awards in each category for MSMEs. 
  • Hike in production and profit.
  • All the measures are there to prove the quality and not affecting the environment.
  • Technological advancement and innovations.
• There is prize money of 2 lakhs for the winners that will strengthen their business. Also, they will get an appreciation letter from the government with a trophy. 

Awards for Commercial startups MSMEs

The winner will get the prize money of 2 lakh rupees, a trophy, and the appreciation letter. 

What will be the procedure of the scheme?

There are several things the government will introduce every year.

• The MSME commissioner will offer schemes through local newspaper advertising every year. The awards groups will be notified by the widely spread advertising media and newspapers. 
• The MSME commissioner will release the application and procedure for these schemes, and businesses can check these out while registering their business. 
• There will be the constitution of a committee that will check the procedures and applications of the business. 
• After the registration, the selected businesses will be announced by the MSME commissioner. 

The MSME startup will get only one award in each category; there are not several awards for the startups in the industrial policy 2020.

Who will sanction the budget?

The government has decided on a budget head to sanction the amount of the schemes. The budget head will grant the amount to the commissioner.

We at SDS Fin Advisory LLP are engaged in the field of Project Finance, MSME Loan, Working Capital, Unsecured loan and Government Subsidy work since 20 years. We provide best service with most satisfactory result in timely manner. We have more than 1000 happy clients. Feel free to contact us on 848596003 or info@sdsfin.in.